Sirius on the Hiking Trail

As Sirius (SIRI Quote) eyes expensive new expansion plans, some investors have started to see rate hikes as the best way to bring losses under control.

Fans of the New York pay radio shop were told in February that the tide of red ink could turn by year-end. But that goal seems even more distant now that capital spending is expected to double to $110 million this year, as the company prepares a massive upgrade of its repeater antenna network. The heavy investment is intended to open the way to new services like video and data.

All the spending talk has investors bracing for yet another heated debate over whether satellite radio is a perpetual cash furnace or if it has emerged as a popular consumer service on the verge of profit.

One possible solution being discussed by Sirius executives seems to please investors: raising subscription fees. ...